The Dow Jones Industrial Average, usually shortened to the Dow and listed by brokers as US30, tracks 30 large US companies. Unlike most modern indices it is price weighted: the sum of the 30 share prices is divided by a number called the Dow divisor. A company with a high share price therefore moves the Dow more than a larger company with a low share price.
Key takeaways
- The Dow was first published on 26 May 1896 with 12 companies and expanded to 30 in 1928.
- It is calculated by adding the share prices of its 30 members and dividing by the Dow divisor, which is adjusted after stock splits and membership changes so the index does not jump.
- Because the divisor is below 1, a $1 change in any member’s share price moves the index by several points.
- Members are chosen by a committee at S&P Dow Jones Indices, not by a size rule.
- With only 30 stocks the Dow is a narrow sample, but it remains the most quoted index in the news.
| Tracks | Dow Jones Industrial Average |
|---|---|
| Constituents | 30 large US companies, excluding transport and utilities |
| First published | 26 May 1896 |
| Weighting | Price weighted |
| Formula | Sum of 30 share prices ÷ Dow divisor |
| Cash session | 09:30–16:00 New York |
| Common broker symbols | US30, DJ30, WS30 |
| Symbol at Marketsall | US30 |
How is the Dow Jones calculated?
Add up the share prices of the 30 members and divide by the Dow divisor. That is the whole formula. The divisor started as the number of companies, so the first Dow was a simple average. Every time a member splits its shares, pays a special dividend or is replaced, the sum of prices changes for reasons that have nothing to do with the market. The divisor is adjusted at that moment so that the index level stays the same. After more than a century of adjustments it is well below 1.
| Step | Calculation | Result |
|---|---|---|
| Sum of 30 share prices | Add the last prices | $7,200 |
| Divide by the divisor | 7,200 ÷ 0.16 | 45,000 points |
| One member rises by $1 | New sum $7,201 ÷ 0.16 | 45,006.25 points |
| Effect of a $1 move | 1 ÷ 0.16 | About 6.25 points, for any member |
The last row is the key point. A $1 rise in a $500 share is a 0.2% move; a $1 rise in a $50 share is a 2% move. Both add the same number of points to the Dow. The actual divisor changes over time and is published by the index provider.
Why price weighting matters
| Feature | Price weighted (Dow) | Value weighted (S&P 500) |
|---|---|---|
| What sets influence | Share price | Total market value of the company |
| Effect of a stock split | Influence falls, even though the company is unchanged | No effect |
| Largest companies | Can have little weight if their share price is low | Always the largest weights |
| Number of stocks | 30 | About 500 |
| Read more | This guide | US500 guide |
The practical consequence is that the Dow can diverge from the wider market for a day or a week when one high-priced member has news. Some of the largest US companies have been added only after they split their shares, because a very high share price would otherwise have given them too much weight. The three US benchmarks are compared in detail in S&P 500 vs Nasdaq 100 vs Dow Jones.
What moves the Dow?
| Driver | How it tends to work | What to watch |
|---|---|---|
| High-priced members | News on the stocks with the highest share prices moves the index most. | Results and guidance from those companies |
| Earnings season | Thirty companies report over a few weeks each quarter. | earnings season, how stock CFDs behave around earnings |
| Interest rates | Banks, industrials and consumer firms react to rate expectations differently from technology firms. | FOMC meetings, Treasury yields |
| Economic data | The Dow has more industrial and financial exposure than the Nasdaq 100. | PMI surveys, Non-Farm Payrolls, US CPI |
| Trade policy | Many members earn a large share of revenue abroad. | Tariff announcements |
When does the US30 trade?
Full timings, including clock changes, are in index CFD trading hours. The same market-wide circuit breakers that apply to the S&P 500 halt trading in all Dow members; see the US500 guide.
What is a Dow point worth?
For a CFD, the symbol specification states the value of one index point per lot. Profit or loss is points moved × value per point × lots. At a level of 45,000, a 1% move is 450 points, a much larger number than the 65 points of a 1% move in the US500 at 6,500. The percentage risk is the same; the point count is not, so compare positions in money, not points.
What it costs to trade the Dow Jones (US30) as a CFD
A US30 CFD tracks the level of the Dow Jones Industrial Average; no shares are owned. See what a CFD is and index trading.
| Cost | When it applies | Note for the Dow Jones (US30) |
|---|---|---|
| Spread | Every trade, at entry | Tightest in the US cash session; wider overnight |
| Commission | Depends on instrument and account type | Shown in the symbol specification in MetaTrader 5 |
| Swap / overnight financing | Positions held past the daily rollover | Charged daily on positions held past the rollover. |
| Dividend adjustment | Cash-based index CFDs, when constituent shares go ex-dividend | Long positions are typically credited and short positions debited, so that the index’s fall on the ex-dividend date creates no profit or loss. |
| Contract rollover | Only if the CFD is based on a futures contract | The price adjusts when the underlying contract changes. |
| Slippage | Fast markets, gaps, news | Most likely at the cash open, on major data and on results from high-priced members |
Key risks
Single-stock effect. A large move in one high-priced member can move the whole index.
Overnight gaps. Results and news often arrive outside the cash session. See gap risk.
Large point values. Big numbers of points can make sizing errors easy.
Leverage. See how leverage increases trading risk.
Risk warning. Trading CFDs carries a high level of risk since leverage can work both to your advantage and disadvantage. As a result, the products offered on this website may not be suitable for all investors because of the risk of losing all of your invested capital. You should never invest money that you cannot afford to lose, and never trade with borrowed money.
How to trade the Dow Jones (US30) at Marketsall
The Dow Jones is listed as US30 on MetaTrader 5 and Web Trader. Read the symbol specification for contract size, margin and swap rates before a first trade; how to read contract specifications on MT5 shows where they are. Practise on a demo account first, keeping in mind the differences covered in demo vs live accounts, and set the position size before opening the ticket with position sizing.
Frequently asked questions
How is the Dow Jones calculated?
The Dow Jones Industrial Average is the sum of the share prices of its 30 member companies divided by the Dow divisor. The divisor is adjusted after stock splits, special dividends and membership changes so that those events do not change the index level.
What is the Dow divisor?
The Dow divisor is the number used to convert the sum of the 30 share prices into the index level. It started as the number of companies but has been reduced over time to offset stock splits and substitutions. It is now well below 1, so a $1 change in any member moves the index by several points.
Why is the Dow price weighted?
When the Dow was created in 1896 calculations were done by hand, and averaging share prices was the simplest method. The index has kept that method for continuity. As a result, companies with higher share prices have more influence, regardless of their total size.
What is the difference between the Dow and the S&P 500?
The Dow tracks 30 companies and is weighted by share price. The S&P 500 tracks about 500 companies and is weighted by market value, so the largest companies have the most influence. The S&P 500 is the broader measure of the US market; the Dow is the more quoted headline number.
What is US30?
US30 is a common broker symbol for a CFD that tracks the Dow Jones Industrial Average. The name refers to the index’s 30 US companies. The CFD lets you take a position on the index level without owning any shares.
Related reading
Rank the members by share price
Sorting the 30 members by share price before results season shows which reports could swing US30 the most. A split can cut a member's sway overnight, and the section on price-weighted indices in stock splits and stock CFDs spells out why.
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